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There are different types of loan modification companies who can help you in modifying the mortgage payments and avoid all possible chances of foreclosure. Do thorough researches on the company before you decide to sign up with them. Here are the different types of companies offering loan modification programs.

1) Mortgage Banker / Broker

These types of companies will generally charge you a fee of $1000 to $3000. This is probably the least desirable type of company to use to work on your loan modification. There is always a food for thought when dealing with such companies. Why will anyone like to work with such companies when they got you into such troubles in the first place? If you choose to work with this type of company, beware of slick sales pitches and attempts to collect large upfront fees. Get everything in writing and accept no verbal promises. If they promise you something and do not put it in writing, don’t get engaged with them.

2) Loan Modification Company (non-attorney based)

These types of company will generally charge you a fee of $1000 to $3000. They are non-attorney based companies that have fewer teeth than a company that utilizes the services of an attorney but costs less money to use. Depending on the origins of the company, this could be a viable option. Make sure that you do a thorough research and ask lots of questions when dealing with one.

3) Loan Modification Company (attorney based)

Their services generally cost between $2500 to $7000. These companies will usually use the services of an outside attorney to review loan documents and write letters on attorney letterhead. Attorney based companies have the force of implied threatened litigation behind them which enables them to gain the attention of your lender quickly. Remember this type of company is hiring an outside attorney which can be done by you as well.

4) Loan Modification companies (attorneys on staff)

Their services generally cost between $5000 – $10,000. This is the toughest type of loan Modification Company. On staff attorneys give this type of company the ability to threaten litigation and follow through on your behalf. Be sure to probe the availability of legal services available here. Many of these companies will function as your advocate up until the time that litigation actually becomes necessary, and then have their own staff attorney take over the case for you, eliminating the need to find an attorney who is unfamiliar with your situation later on if needed. This type of company has the added benefit of being able to have their attorney switch gears to dealing with foreclosure, or bankruptcy if needed. The continuity of having the same familiar legal hands on your file from start to finish makes this a very attractive and cost effective option. Be sure to iron out when the attorney on staff would take over the file, and what the charges for that end of the services would be.

Law offices:

Services of Law Offices cost $150 – $450 per hour. The average loan modification file can have 40 to 60 hours of work into it by completion

40 X $150 = $6000 | 40 X $450 = $18000

You can see that this is by far the most expensive way of handling a loan modification. If a principal reduction is your goal, this could be well worth it. This option also has the sharpest teeth, if the firm specializes in RESPA, HOEPA, TILA and other lending laws, you could come out way ahead. Law firm letterhead will gain the attention of the lenders executives and move your file ahead of others at your bank. Make sure that they have been in this area of practice for a long time prior to the downfall in the market. If you are going to pay an attorney, make sure you are getting experienced, competent representation.

The company that you choose to hire will make or break your loan modification. You should make absolutely certain the company you choose to hire is going to work on your loan modification with the dedication and determination you would bring to the table. If you don’t get the feeling that they will take your negotiations personally, don’t hire them to work for you. Remember, if you are properly prepared, and educate yourself, you can have a professional do a loan document review/audit, prepare a report for you, and then take it from there yourself.